Gender equality is good for business

International Women’s Day is a time when we come together as a global society to acknowledge the tremendous social, economic, cultural and political achievements of women around the world. While there is much to celebrate, it’s also a time to recognize how much work is still left to do.

Thanks to extensive data and research, and growing transparency, the case for gender equality has never been clearer. We have made significant progress in many areas of the world and yet there is still so much work to be done. One of the United Nations Sustainable Development Goals targets gender equality because women and girls represent half of the world’s population and, therefore, half of its potential. Gender equality is critical not only to maintaining peaceful communities, but to building a sustainable and flourishing global economy.

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Women still have fewer economic opportunities than men, less access to education, and less political representation. According to the 2016 Global Gender Gap report by the World Economic Forum, the gap between women and men on economic participation is worsening: Only 59 percent of the economic participation gap has been closed, which is a continued reversal on several years of progress and the lowest value measured by the Index since 2008. This downward trend is not only disheartening but detrimental to economic growth.

This week, I spoke at the U.S. Chamber of Commerce Foundation’s International Women’s Day Forum to discuss how to achieve gender equality in the workplace, marketplace, and community. Businesses need to be an equal partner in driving forward momentum. The Fourth Industrial Revolution will be fueled not only by emerging technologies and advances in innovation, but human expertise. In order for society to reach its highest potential in building a sustainable future, we need to tap into the full pool of human talent.

Organizations that embrace diversity and inclusion will be more competitive in the coming decades and outperform the companies that fall behind. A recent study on business and diversity by McKinsey & Company found that companies in the top quartile for gender diversity on their executive teams were 21 percent more likely to experience above-average profitability.

Additionally, the study found a positive correlation between gender diversity on executive teams and two key measures of financial performance: operating margin and longer-term value creation, as measured using an economic-profit margin. This is likely why measuring diversity is now becoming a key financial metric that investors and analysts assess when making investment decisions.

Businesses are getting on board, especially given the uptick in media interest on gender equality. Leaders now understand that customers want to partner with diverse organizations. The best talent want to work for diverse organizations and investors are putting their capital into diverse organizations. These trends are moving the needle and building a diverse workforce has become a boardroom issue.

In my experience, I’ve found that there are several key factors that can help achieve these goals: buy-in from the top, public commitment, transparency and measurement, and a focus on inclusion. This rough outline is a good framework for organizations that are looking to ramp up their efforts in the space and who understand the financial drivers for doing so.

Buy-in from the top is likely the number one driver of change. If the CEO makes it a priority to build diverse teams and put women in key leadership positions, the rest of the organization will follow suit. This commitment needs to be coupled with regular updates on progress. Hiring managers will act in accordance, ensuring diverse candidate slates are provided for every open position and managers will follow suit.

Making a public commitment to build a diverse and inclusive workforce is a good start. It lets your stakeholders know that you recognize the financial benefits and are making this a key priority across the organization. Making data publicly available will also help build reputational capital in this age of increasing transparency. It will also help you measure your progress and track where you are succeeding and how you can improve. With data getting smarter and tools for measurement more sophisticated, tracking is easier than ever before and helps you determine where to allocate resources and where you need to increase attention.

Last, attracting diverse candidates means nothing in the long run if they don’t stay. In addition to diversity, a focus on inclusion is imperative. Companies need to develop a culture that supports and cultivates female talent. This means implementing programs that help women not only stay in the workforce, but thrive in the workforce. Clearly defined paths for promotion, a flexible work culture and mentorship are all significant drivers of inclusion. The most financially successful organizations aren’t only the ones who hire women, but, that have women in decision-making positions to drive the company’s future.

There is clearly a values-based case for promoting gender equality around the world, and that is what the fifth Sustainable Development Goal is holistically aimed at achieving. Access to education and health care are paramount. But gender parity in economic opportunity is fundamentally linked to whether or not societies will be sustainable. The evidence is clear, women must be an equal part of the global talent pool in order to recognize the world’s full potential and that means ensuring they have an equal place businesses throughout the world.

Patsy Doerr is the global head of corporate responsibility and inclusion at Thomson Reuters.